The beauty of binary options is the simplicity of trading.Any individual with any skill level can trade binary options, all that is needed is the prediction of movement and direction. As a beginner in binary options, some strategies need only a little experience. These strategies are ideal for entry level traders. These are the strategies ‘newbies’ should look to get to grips with first.
Knowing when to trade the right call or put is the main issue in binary options. You have numerous assets to focus on in binary options, but the most effective is a single asset trade. As a beginner, some selected strategies has been selected to guide you;
- Trend Strategy: This is not limited only to beginners, most experienced traders also utilize the strategy. As a beginner, let the trends be your friend. This is a popular approach in binary options, and it’ll continue to be because the trends will always be there. It is a bull bearish strategy that keeps monitoring the rise and decline of the traded asset. When there’s a flat trend line with a positive prediction, go with the No Touch But if the trend shows that there will be a rise, trade call. When the trend line shows a decrease, go with Put. This strategy is like the CALL/PUT method.
- Straddle Strategy: This strategy is highly respected among traders. The best application period is during market volatility, the expectation of news concerning an asset, and when analyst predictions seem The straddle strategy is not hinged solely on the CALL/PUT options; you can trade on a single asset using two choices. You can predict an increase or decrease on a single asset simultaneously. The idea is to utilize CALL when there’s an increase in the worth of the asset, but with an indication that it will fall soon. When the decrease starts to occur, place a CALL option on it, with the hope of a bounce back. This can also be traded in the reverse direction. The strategy guarantees a huge success in at least one of the positions with an “in the money” result. This strategy is hugely utilized when there is a rapid up and down movement in the market.
- Pinocchio Strategy: You can practice this strategy using a demo account of your broker. You should utilize this strategy when a drastic fall or rise is anticipated in the value of an asset. If a rise is expected, CALL the options, but if a drop is expected trade PUT.
- Hedging Strategy: This strategy is utilized to protect traders from risk. It is also known as pairing. Corporations, traders, investors and traditional stock exchanges also employ the strategy in trading. This strategy entails placing CALL and PUT on the same asset at the same time. The advantage of this strategy is that no matter the final direction of the asset, a successful outcome will be recorded. Using this method, you are shielding your capital from any scenario produced. Hedging is an insurance approach that pays if the loss is recorded.
- Risk Reversal Strategy: Experienced binary options traders are fond of this strategy, but as a beginner, you can utilize the strategy The main benefit of the strategy is a lowered risk ratio to a high success rate. Just like hedging, CALL and PUT are placed on an asset simultaneously. This is mostly applicable to assets with fluctuating value and random direction.
- Fundamental Analysis:. This is a method of evaluating the value of the asset by examining related economic, financial and other qualitative and quantitative factors. An example is when determining the intrinsic value of Corn, one may look at the effects the weather is having upon the crops.
No single strategy is the best.Do not rely only on one when you start out as a beginner. A combination of related strategies will improve your chances of success. Try out different strategies and settle for the one(s) that suit you and your trading aims.